UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
INTERNATIONAL GAME TECHNOLOGY
PROFIT SHARING PLAN
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
INTERNATIONAL GAME TECHNOLOGY
9295 Prototype Drive, Reno, NV 89511
(702) 448-1200
<PAGE>
INTERNATIONAL GAME TECHNOLOGY
PROFIT SHARING PLAN
Financial Statements for the Years
Ended December 31, 1996 and 1995,
Supplemental Schedules for the Year
Ended December 31, 1996, and
Independent Auditors' Report
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
TABLE OF CONTENTS
Page
Independent Auditors' Report 1
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available
for Benefits 3
Notes to Financial Statements 4
Item 27a - Supplemental Schedule of Assets Held
for Investment Purposes 11
Item 27d - Supplemental Schedule of Reportable Transactions -
Single Transactions in Excess of 5% of Plan Assets 12
Item 27d - Supplemental Schedule of Reportable Transactions -
Series of Transactions in Excess of 5% of Plan Assets 13
<PAGE>
INDEPENDENT AUDITORS' REPORT
International Game Technology Profit Sharing Plan:
We have audited the accompanying statements of net assets available
for benefits of International Game Technology Profit Sharing Plan (the
"Plan") as of December 31, 1996 and 1995, and the related statements
of changes in net assets available for benefits for the years then
ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the net assets available for benefits of the Plan
at December 31, 1996 and 1995, and the changes in net assets available
for benefits for the years then ended in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental
schedules listed in the Table of Contents are presented for the
purpose of additional analysis and are not a required part of the
basic financial statements, but are supplementary information required
by the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974.
These supplemental schedules are the responsibility of the Plan's
management. Such schedules have been subjected to the auditing
procedures applied in our audit of the basic 1996 financial statements
and, in our opinion, are fairly stated in all material respects when
considered in relation to the basic financial statements taken as a
whole.
April 25, 1997
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
<TABLE>
<CAPTION>
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1996 AND 1995
ASSETS 1996 1995
<S> <C> <C>
Money market and cash equivalents $ 132,686 $ 1,081,818
Investments, at fair value 60,244,400 43,669,806
Contributions receivable 228,565 153,400
Loans to participants 3,112,384 2,393,233
Total assets 63,718,035 47,298,257
NET ASSETS AVAILABLE FOR BENEFITS
$63,718,035 $47,298,257
</TABLE>
See accompanying notes to financial statements.
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
<TABLE>
<CAPTION>
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1996 AND 1995
1996 1995
<S> <C> <C>
ADDITIONS TO NET ASSETS ATTRIBUTED TO:
Investment income:
Net increase in fair value of investments $ 9,876,533 $ 712,300
Interest 481,116 320,503
Dividends 986,629 844,818
11,344,278 1,877,621
Contributions:
Employer 7,274,873 5,758,711
Employee 2,929,604 2,578,958
Total additions 21,548,755 10,215,290
DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO:
Benefits paid to participants 4,788,302 2,883,029
Administrative expenses 340,675 201,860
Total deductions 5,128,977 3,084,889
NET INCREASE 16,419,778 7,130,401
NET ASSETS AVAILABLE FOR BENEFITS:
BEGINNING OF YEAR 47,298,257 40,167,856
END OF YEAR $63,718,035 $47,298,257
</TABLE>
See accompanying notes to financial statements.
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1996 and 1995
1. DESCRIPTION OF PLAN
The IGT Profit Sharing Plan ("Plan") is sponsored by International
Game Technology (the "Company") and consists of two programs: The
Profit Sharing Program and the 401(k) Program. The following is a
brief description of the Plan and provides general information.
Participants should refer to the IGT Plan Document and Summary
Plan Description for a more complete description of the Plan's
provisions.
The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA"), as amended, and other
provisions of the Internal Revenue Code.
Profit Sharing Program - The Plan, adopted December 10, 1980, is a
defined contribution plan covering all eligible employees of
International Game Technology. On June 1, 1993 the Plan was
restated to offer additional investment options to participants as
well as transfer the administration to a Third-Party Administrator
(refer to "Investment Options" below for further information of
available investment funds).
Company employees are eligible to participate in the Plan after
completing 1,000 hours of service in a calendar year and reaching
the age of 18. Once eligible, a Plan participant must be employed
on the last day of the Plan year (December 31) to receive their
annual profit sharing allocation. Participation in the Plan is
retroactive to January 1 of the year in which the employee became
eligible.
The Company may make an annual profit sharing contribution, as
determined by the Company's Board of Directors, based on operating
profits. The contribution is then allocated to participant's
accounts proportionately based on annual eligible compensation.
(Refer to "Benefit Payments and Vesting" below for the Profit
Sharing Program vesting schedule).
401(k) Program - Effective January 1, 1989, the Plan was amended
to allow participants to defer up to 20% of their annual salary as
contributions to their accounts, as governed by IRC Section
401(k). On January 1, 1995, the Company again amended the Plan to
lower the elective deferrals from 20% to 15%. An employee may
begin contributing pre-tax contributions to their accounts upon
completion of 90 days of full time employment, or one year as a
part-time employee. A participant may stop contributing to the
Plan at any time upon adequate notice to the employer.
On January 1, 1993, the Company began a 401(k) contribution
matching program whereby the Company matches 100% of an employee's
contributions up to $500 and an additional 50% of the next $500
contributed by the employee. This allows for maximum annual
Company matching contributions of $750 to each employee's account.
Employees are 100% vested in all 401(k) contributions.
The Plan also allows for rollover contributions from other
qualified retirement plans. If the rollover is by way of an
individual retirement arrangement, all assets in the prior
retirement plan must have originated as contributions made under a
qualified plan.
<PAGE>
Participant Accounts - Each participant's account is credited with
employee 401(k) and employer matching contributions, the
allocations of the Company's profit sharing contribution and
forfeitures of non-vested portions of terminated participants'
account balances. Additionally, participants' accounts are
effected by earnings and losses on investments. Each participant
is provided a quarterly account statement detailing the account
activity by investment fund.
Investment Options - The Company has selected seven investment
options that have a variety of growth and risk characteristics.
Plan participants are able to elect how their contributions are
invested. A participant may allocate all contributions to one
investment fund or split them between any combination of funds in
increments of 1%. A participant may change how current and/or
future contributions are invested at any time during the Plan
year. The Plan's investment options are:
Capital Market Group Government Money Fund
Capital Market Group Intermediate Fixed Income Fund
Capital Market Group Small Capitalization Growth Equity Fund
Capital Market Group Large Capitalization Growth Equity Fund
Capital Market Group Large Capitalization Value Equity Fund
Capital Market Group International Equity Investment Fund
Common Stock - International Game Technology
Benefit Payments and Vesting - Participants are immediately vested
in their pre-tax 401(k) contributions, Company 401(k) matching
contributions, and rollover contributions from other qualified
plans, plus earnings thereon. The vested portion of a
participant's profit sharing account is based upon years of
continuous service. A participant is 100% vested after seven
consecutive years of service, per the following vesting table:
Completed
Years
of Vesting Vested
Service Portion
0 0%
1 10%
2 20%
3 30%
4 45%
5 60%
6 80%
7 100%
<PAGE>
A participant earns a year of vesting service for
each Plan year (January 1 to December 31) in
which he or she worked at least 1,000 hours.
Upon termination of employment, a participant may
receive a lump sum payment equal to the value of
his or her account. If the termination of
employment is by normal retirement (retirement
after age 65), by death or by reason of total
disability, the participant is 100% vested and
has the right to receive payment in full. If a
participant leaves the Company for any other
reason, he or she is entitled to a distribution
from the vested portion of his or her account.
If a participant's vested account balance is
$3,500 or more, he or she may voluntarily defer
payment of benefits until the normal retirement
date. In any case, he or she may not defer
payment past the age of 70 1/2. The only form of
benefit payments are lump-sum payments, however,
a participant may take a partial lump-sum payment
and defer the balance of his or her account as
long as the remaining balance is at least $3,500.
Hardship Withdrawals - The Plan allows for
hardship withdrawals under defined circumstances.
The necessity of the hardship withdrawal is
reviewed by the Company's Benefits Committee and
includes allowance for major medical expenses,
purchase of a primary residence, college expenses
for a family member, and prevention of eviction
from or foreclosure on a principal residence. A
participant must stop making pre-tax 401(k)
contributions for a year following the hardship
withdrawal.
Plan Termination - In the event of Plan
termination, participants will become 100% vested
in their accounts. Although the Company has not
expressed any intent to do so, International Game
Technology has the right under the Plan to
discontinue its contributions at any time and to
terminate the Plan subject to the provisions of
ERISA.
Loans - The Plan allows for loans to be taken
against a participant's vested account, subject
to the following restrictions: the loan amount
may be no less than $1,000 and no more than the
lesser of 50% of the participant's vested account
balance or $50,000; interest is charged on a
simple interest basis at the prime rate plus 1%;
and repayment must be over a period not to exceed
60 months. Payments are made by payroll
deduction on a bi-weekly basis.
Administrative Expenses - Plan administrative
expenses totaling $340,675 in 1996 and $201,860
in 1995 were paid by the Plan. These include
management fees and trustee fees. Consulting
fees and recordkeeping fees are paid by the
Company.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The Plan is accounted for
on the accrual basis of accounting.
Cash and Cash Equivalents - Securities with
maturities upon purchase of three months or less
are considered cash equivalents. Such
investments are stated at cost, which
approximates market, and are deemed to be cash
equivalents.
Valuation of Investments - All investments of the
Plan are valued at quoted market prices as of
December 31, 1996 and 1995.
Benefits Payable - As of December 31, 1996 and
1995, net assets available for benefits included
benefits of $2,620,433 and $1,852,970 due to
participants who have withdrawn from
participation in the Plan.
<PAGE>
3. INVESTMENTS
<TABLE>
<CAPTION>
All investments of the Plan are administered by
an investment management agent. The following
table presents the fair value of investments at
quoted market prices at December 31:
1996 1995
<S> <C> <C>
Capital Market Group Government Money Fund $ 9,667,152 $11,588,955
Capital Market Group Intermediate Fixed
Income Fund 3,993,725 3,725,340
Capital Market Group Small Capitalization
Growth Equity Fund 7,706,054 5,895,452
Capital Market Group Large Capitalization
Growth Equity Fund 9,076,881 7,085,666
Capital Market Group Large Capitalization
Value Equity Fund 8,500,035 6,529,601
Capital Market Group International Equity
Investment Fund 836,810 641,736
Common stock - International Game
Technology 13,970,977 8,203,056
U.S. Treasury Bills 6,492,766 -
Total investments $60,244,400 $43,669,806
</TABLE>
<PAGE>
4. FUND INFORMATION
<TABLE>
<CAPTION>
Contributions, withdrawals, investment income and
changes in fair value of investments by fund are
as follows for the years ended December 31, 1996
and 1995:
1996 1995
<S> <C> <C>
Participant Contributions:
Capital Market Group Government Money Fund $ 399,692 $ 326,277
Capital Market Group Intermediate Fixed
Income Fund 205,387 222,449
Capital Market Group Small Capitalization
Growth Equity Fund 555,275 414,559
Capital Market Group Large Capitalization
Growth Equity Fund 569,053 445,742
Capital Market Group Large Capitalization
Value Equity Fund 501,981 388,425
Capital Market Group International Equity
Investment Fund 131,003 98,968
Common Stock - International Game
Technology 567,213 682,538
Total $ 2,929,604 $2,578,958
Employer Contributions:
Capital Market Group Government Money Fund 121,226 5,018,082
Capital Market Group Intermediate
Fixed Income Fund 76,746 72,874
Capital Market Group Small Capitalization
Growth Equity Fund 148,198 104,154
Capital Market Group Large Capitalization
Growth Equity Fund 160,919 118,633
Capital Market Group Large Capitalization
Value Equity Fund 150,555 113,448
Capital Market Group International
Equity Investment Fund 30,818 22,407
Common Stock - International Game
Technology 219,857 309,113
U.S. Treasury Bills 6,366,554 -
Total $ 7,274,873 $5,758,711
Total Contributions $10,204,477 $8,337,669
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
1996 1995
<S> <C> <C>
Withdrawals:
Capital Market Group Government Money Fund $1,428,501 $ 651,328
Capital Market Group Intermediate Fixed
Income Fund 302,837 279,654
Capital Market Group Small Capitalization
Growth Equity Fund 695,560 219,935
Capital Market Group Large Capitalization
Growth Equity Fund 666,628 276,870
Capital Market Group Large Capitalization
Value Equity Fund 706,189 301,277
Capital Market Group International
Equity Investment Fund 72,312 15,294
Common Stock - International Game
Technology 754,164 892,206
Loan Fund 162,111 246,465
Total $4,788,302 $2,883,029
Interest and Dividends:
Capital Market Group Government Money Fund 467,789 412,380
Capital Market Group Intermediate Fixed
Income Fund 235,328 204,117
Capital Market Group Large Capitalization
Growth Equity Fund 50,862 30,793
Capital Market Group Large Capitalization
Value Equity Fund 225,870 139,352
Capital Market Group International
Equity Investment Fund 10,097 10,135
Common Stock - International Game
Technology 98,004 98,014
Loan Fund 235,158 167,145
U.S. Treasury Bills 144,637 103,385
Total $1,467,745 $1,165,321
Increase (Decrease) in Fair Value of
Investments:
Capital Market Group Intermediate
Fixed Income Fund $ (97,410) 231,579
Capital Market Group Small Capitalization
Growth Equity Fund 1,156,324 1,493,320
Capital Market Group Large Capitalization
Growth Equity Fund 1,452,790 1,363,609
Capital Market Group Large Capitalization
Value Equity Fund 1,166,262 1,381,450
Capital Market Group International Equity
Investment Fund 22,853 46,429
Common Stock - International Game
Technology 6,175,714 (3,804,087)
Total $9,876,533 $ 712,300
</TABLE>
<PAGE>
5. FEDERAL INCOME TAXES
The Plan has received a determination letter
dated November 30, 1995 from the Internal Revenue
Service qualifying it as an exempt organization
under Sections 401(a) and 501(a) of the Internal
Revenue Code. Accordingly, no provision for
federal income taxes has been made in the
accompanying financial statements.
******
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
<TABLE>
<CAPTION>
ITEM 27a - SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR
INVESTMENT PURPOSES
DECEMBER 31, 1996
(b) (c) (d) (e)
Maturity Interest Current
Description Date Rate Units Cost Value
<S> <C> <C>
Capital Market Group Government
Money Fund 9,667,152 $ 9,667,152 $ 9,667,152
Capital Market Group Intermediate
Fixed Income Fund 496,115 4,022,956 3,993,725
Capital Market Group Small
Capitalization Growth Equity
Fund 470,455 7,186,264 7,706,054
Capital Market Group Large
Capitalization Growth Equity 640,119 7,314,445 9,076,881
Fund
Capital Market Group Large
Capitalization Value Equity 692,749 7,041,377 8,500,035
Fund
Capital Market Group International
Equity Investment Fund 82,852 865,192 836,810
Common Stock - International Game
Technology 765,533 12,048,044 13,970,977
U.S. Treasury Bills 6,492,766 6,488,760 6,492,766
Total investments $54,634,190 $60,244,400
</TABLE>
Notes on Columns (a) through (e):
(a) Omitted from the Department of Labor format because the answer is none.
(b) General description of investments.
(c) Maturity dates and stated rates of interest are not applicable
due to the nature of these investments.
(d) Purchase price of investment.
<PAGE>
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
<TABLE>
<CAPTION>
ITEM 27d - SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS - SINGLE
TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1996
(a) (b) (c) (d) (g) (h) (I)
Identity of Party Descriptions of Purchase Selling Cost of Value of Net
Involved Transaction Price Price Asset Transaction Gain/Loss
<S> <C> <C> <C> <C>
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury bills $4,945,000 - - - -
Smith Barney Redemption of U.S.
Shearson, Inc. Treasury bills - 4,945,000 4,945,000 4,945,000 -
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury bills 3,350,000 - - - -
Smith Barney Redemption of U.S.
Shearson, Inc. Treasury bills - 3,350,000 3,350,000 3,350,000 -
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury bills 2,595,000 - - - -
Smith Barney Redemption of U.S.
Shearson, Inc. Treasury bills - 2,595,000 2,595,000 2,595,000 -
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury bills 2,615,000 - - - -
Smith Barney Redemption of U.S.
Shearson, Inc. Treasury bills - 2,615,000 2,615,000 2,615,000 -
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury bills 3,330,000 - - - -
Smith Barney Redemption of U.S.
Shearson, Inc. Treasury bills - 3,330,000 3,330,000 3,330,000 -
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury bills 6,518,000 - - - -
Smith Barney Purchase of Reserve
Shearson, Inc. Deposit Account 4,951,651 - - - -
Smith Barney Redemption of Reserve
Shearson, Inc. Deposit Account - 3,773,274 3,773,274 3,773,274 -
</TABLE>
Notes to columns (c) through (i)
(c) Purchase price of investments bought during the year.
(d) Proceeds received from redemption of investments maturing or sold during the
year.
(e) and (f) Omitted from the Department of Labor format because the answer is
none
(g) Purchase price of investment plus or minus the amortization of discount or
premium received or paid at the date of sale.
(h) Market value at the date of maturity or sale for each investment shown in
column (d)
(i) Difference between columns (d) and (g)
<page
INTERNATIONAL GAME TECHNOLOGY PROFIT SHARING PLAN
<TABLE>
<CAPTION>
ITEM 27d - SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS - SERIES OF
TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1996
(a) (b) (c) (d) (g) (h) (i)
Identity of Description Purchase Selling Cost of Value of Net
Party Involved of Transaction Price Price Asset Transaction Gain/Loss
<S> <C> <C> <C> <C> <C> <C>
Smith Barney Purchase of Capital
Shearson, Inc. Market Group
Government Money Fund $ 7,084,507 $ - $ - $ - $ -
Smith Barney Sale of Capital
Shearson, Inc. Market Group
Government Money Fund - 4,079,827 4,079,827 4,079,827 -
Smith Barney Purchase of Capital
Shearson, Inc. Market Group Large
Capitalization Value
Equity Group 2,990,244 - - - -
Smith Barney Purchase of Capital
Shearson, Inc. Market Group Large
Capitalization Growth
Equity Fund 3,115,251 - - - -
Smith Barney Purchase of Capital
Shearson, Inc. Market Group Small
Capitalization Growth
Equity Fund 4,306,638 - - - -
Smith Barney Sale of Capital
Shearson, Inc. Market Group Small
Capitalization Growth
Equity Fund - 2,702,023 2,288,939 2,702,023 413,083
Smith Barney Purchase of IGT
Shearson, Inc. common stock 3,069,605 - - - -
Smith Barney Sale of IGT common
Shearson, Inc. stock - 3,385,590 3,006,461 3,385,590 379,129
Smith Barney Purchase of Reserve
Shearson, Inc. Deposit Account 13,563,474 - - - -
Smith Barney Sale of Reserve
Shearson, Inc. Deposit Account - 14,519,095 14,519,095 14,519,095 -
Smith Barney Purchase of U.S.
Shearson, Inc. Treasury Bills 25,185,000 - - - -
Smith Barney Redemption of U.S.
Shearson, Inc. Treasury Bills - 18,667,000 18,667,000 18,667,000 -
</TABLE>
Notes to columns (c) through (i)
(c) Purchase price of investments bought during the year.
(d) Proceeds received from redemption of investments maturing or sold during the
year.
(e) and (f) Omitted from the Department of Labor format because the answer is
none.
(g) Purchase price of investment plus or minus the amoritzation of discount or
premium received or paid at the date of sale.
(h) Market value at the date of maturity or sale for each investment shown in
column (d)
(i) Difference between columns (d) and (g).
<PAGE>
The Plan. Pursuant to the requirements of the Securities
Exchange Act of 1934, the trustees (or other persons who
administer the employee benefit plan) have duly caused this
annual report to be signed on its behalf by the undersigned,
thereunto duly authorized.
INTERNATIONAL GAME TECHNOLOGY
PROFIT SHARING PLAN
Date: June 16, 1996
By: /s/ G. Thomas Baker
G. Thomas Baker
President and Chief Operating
Officer
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration
Statement No. 33-63608 of the International Game Technology Profit
Sharing Plan on Form S-8 of our report dated April 25, 1997,
appearing in this Annual Report on Form 11-K of the International
Game Technology Profit Sharing Plan for the year ended December 31,
1996.
DELOITTE & TOUCHE LLP
Reno, Nevada
June 12, 1997
